First Merchants Q2 EPS Misses by 28% as Credit Costs Surge
FRME sits 26% above its 52-week low of $34.66.
Summary
First Merchants reported Q2 adjusted EPS of $0.74, missing the $1.03 consensus by a wide margin. The miss was driven by a sharp increase in credit costs—two commercial loans went nonaccrual, forcing $29.7 million in reserves. This follows a Q1 already pressured by acquisition costs, and the new credit deterioration suggests asset quality is weakening faster than expected. Loan and deposit growth were solid, and noninterest income rebounded, but the provision spike overshadows those positives. With the stock trading near its 52-week high and a buy consensus, this earnings shock could trigger a sharp re-rating. No guidance was provided, leaving uncertainty around the credit trajectory.
At the time of this announcement, FRME was trading at $43.75 on NASDAQ in the Finance sector, with a market capitalization of approximately $2.8B. The 52-week trading range was $34.66 to $45.33. This news item was assessed with negative market sentiment and an importance score of 8 out of 10. Source: Reuters.